Tabco Inc.

Specialization in a strong industry and technological savvy are keys to success for this Kansas converter.

Jack Kenny01.15.08

The Kubicki brothers, from left: John, Ted and Gene

The founder of Tabco Inc. in Kansas City, KS, USA, is fondly remembered by his sons. Gene Kubicki Sr. must have had 30 jobs by the time he was 30 years old, the sons report. He possessed an entrepreneurial spirit "but couldn't figure out what it was he really wanted to do," says Gene Kubicki Jr., president of Tabco. "He worked in sales for a printing company here in town for a little while, and saw some opportunity there." So he acquired a used Mark Andy tape press in 1957 and an old Markem press, and set up shop in his garage to make tapes for hospitals. "He and Mom basically operated in the garage from 1957 to 1962," Gene says. "That's how everybody got started.

Now 50 years in business and in the hands of the second generation — brothers Gene and John, the vice president — Tabco has grown steadily over the years to an annual $6 million in revenue, and is poised to branch out into new manufacturing areas. The company is well established as a label provider for a strong regional market — animal health — and employs 45 people. Another brother, Ted Kubicki, works in sales for the company.

John and Gene worked at Tabco as teenagers, but after high school John went to college and Gene joined the US Navy. They returned to the business in the early 1980s, figuring that they'd hang around until they found something more interesting. "But our father wanted us in the business," says Gene. "That was always his plan." In 1986 they bought out Gene Sr.'s interest. "He had a great succession plan: 'It's yours. I'm leaving. Bye.' "

In the early days the company had mainly tape presses, and tape dominated the output. Tabco also supplied labels for Goodyear and Firestone tires, and were one of just a few US companies that specialized in tire labels. But the brothers didn't see a future in it, so they determined to get into the multi-color label business. "It was around 1987 that we bought a seven color Webtron," Gene recalls. "That was when four color process was starting to really evolve, and we decided we wanted to concentrate on the prime label market."

"That's about the time we got into making labels for the animal health industry," says John, "and that has snowballed since then." The greater Kansas City area (which includes parts of Kansas and Missouri) accounts for more than 30 percent of the total sales in global animal health market, which is about $15.2 billion.

"Four of the 10 largest animal health products companies are headquartered here," says Gene. "We probably work with half of all the companies in the region. A lot are relatively small, but it's one of those industries where when somebody leaves and goes to another company and they're in purchasing, that's the best referral you can have."

"Animal health is a heavily regulated industry," John observes. "What has made us successful is our ability to handle procedures. When the customer comes in to audit us we have all the procedures down, all the SOPs."

"Over the years we have developed a good relationship with these companies," says Gene. "We provide an excellent product very quickly, and if we do a good job they will stick with us. A lot of our customers we have had for 20-plus years. We have one company that started when we came in. Back in the 1980s they were a half-million dollars a year, and now they're $100 million."

At work on an Aquaflex press

Labels for the animal health industry are fairly straightforward in design and production, ranging from two to eight colors. But they often contain extended text labels, and Tabco is right there with that technology.

"Ten years ago extended content was not quite as widespread, rather specialized. We contacted another company that we could source them from and resell them, but that company didn't meet our expectations. Finally we thought this has got to be easier. We bought a unit from Longford, modified it, and made our own."

Animal health labels makes up about 60 percent of Tabco's business. About 30 percent is retail food, and the rest is a wide variety, including health and beauty, industrial markets, and a few Kansas wineries.

Gene Kubicki sees a significant shift in how labels were made. "In the past it was more art than science, but that has shifted a lot in the last 15 or 20 years. To be successful, at least in our segments of the industry, you have to be lean, you have to have your processes down pat."

"You have to have good suppliers," John adds. "When we first started doing four color process it was a guess about what line screen, what aniloxes to use. Now we know that we are going to use a 1,000 line anilox, a certain strength ink, a certain type of plate and a certain type of paper, and we are going to get a beautiful label every time. It's a combination of experience and science."

Over the years Tabco acquired several Webtrons, some of which it still owns and operates. The production room now includes two 13" Aquaflex presses, one seven color, the other 10 color. The company recently sold a Webtron that it had acquired in 1967 on eBay to a company in Mexico. "We ended up selling it for more than we paid for it back then."

Inspection

Because Tabco produces labels for medicines and other products used to maintain and improve the health of animals, it must meet high print standards. As a result, label inspection is critical to the production. Four years ago the company bought its first inspection system from Advanced Vision Technology (AVT), and has since acquired two more.

"Inspection has taken a quantum leap," says Gene. "It has completely changed the perceived quality level that we send out the door. After installing our first system it really opened our eyes that we had been sending out a lot of defective labels. We didn't know about them, and our customers didn't know about them, but sooner or later they were going to find out. Now our number of defects has decreased at least 90 percent, those that have been reported by our customers. And this has been done without slowing down the process. That's the key."

One Aquaflex press at Tabco has an AVT inspection system mounted inline, and Gene sees this as a necessity in the future for all presses.

"If a speck of dust gets stuck on one of your four-point type letters, and every other label has that defect, when we find it at the end of the run we have to throw that roll away," he says. "When you have inspection on press you can figure out what you want to do at that point. We have an inkjet system hooked up to the AVT system that sprays red ink on the edge of the label so that when we rewind we can replace them. You can install a diverter, so that when you go roll-to-sheet you can divert the bad label. But you want to automate the process as much as possible. with roll-to-roll you can't divert them, so you have a system that flags bad labels, or you can make a roll map: Take a roll off the press and the AVT system knows which labels on the press are defective. You can send the data to your rewind and tell the rewinder to stop at certain labels, at which point you can replace them.

"Overall we average 35 percent waste. Setup is probably 10 percent. Twenty-five percent of that is running waste. If I can cut that back to 5 percent that will be ideal. Because if you can identify a defect you can correct it."

Print management

About 10 years ago Gene Kubicki began developing an in-house print management system which has since developed into a comprehensive system. It is one of the factors, he believes, that reinforces the company's value to customers. "We track and record in detail everything that goes through here. We have wireless scanners everywhere to track job status. We have real time tracking, web ordering."

Tabco's first Mark Andy press still works

A few customers can order via online access, though the connection is customized for each customer. "The information that we can supply is sometimes too much for some customers, but when you start getting into the industries that are FDA regulated then suddenly it's not too much. When the FDA comes in and audits them, they'll be able to point to revisions in their labels over several years."

"We have one customer who orders via the web," says John Kubicki. "They have six different distribution centers and we have hooked them all up where they can order through our web and we will ship to six different locations. It involves a lot of training on our part, because we have to go in and show them how it works."

"We have customers who have 2,000 SKUs, with 40 or 50 products on order at any one time," adds Gene. "Once we get our customers relying on information they can access we have them for life, because they don't ever want to give that up. We've looked at off-the-shelf systems, and they do a great job, but it costs a ton of money and it's not a one-time expense. We don't want to depend on anybody else for our information technology, because that's where one of our biggest strengths is."

What's next?

Gene and John have been kicking around ideas for expansion and growth over the past few years. Tabco was an early adopter of digital prepress, bringing in Esko and DuPont equipment several years back when it was still new.

Overview of Tabco press room

"We need to diversify," says Gene, "perhaps into folding carton. A lot of companies don't do just the labels for their customers. You have folding cartons in that mix, inserts, flexible packaging. We will go into one of those areas, but it's expensive for a small company such as ours. The large capital investment is not just in the press but also for the finishing equipment. It will probably be an acquisition rather than building it from the ground up. We'd like to start doing it in-house, but at some point the sheer size makes it less feasible.

"And of course there is digital."

"Digital will be a natural for us," says John. We are probably leaning that way more than any other. It's not really if we are going to go digital, but when."

"We spoke with a customer the other day who wants us to go digital, to get an HP Indigo or two," Gene says. "They have a ton of business to run on it."

Motivation

The Kubicki brothers point with pride to the quality of their employees and how they contribute to the positive work environment.

"What really motivates Gene and me is that we still really enjoy what we do here," says John. "We enjoy coming to work every day, sitting at the meetings discussing everything, always looking for what will be new in the future. It's still fun for us after 25 years."